Griffon Corporation

Good morning and welcome to the Griffin Corporation Fiscal Third Quarter 2023 Earnings Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press Um, star then one on your telephone keypad to withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Brian Harris CFO. Please go ahead.

Thank you, Debbie. Good morning, everyone with me on the call is Ron Kramer, our chairman and chief executive officer. Our call is being recorded and will be available for playback, the details of which are in our press release issued earlier today. As in the past, our comments will include forward-looking statements about the company's performance based on our views of Griffin's businesses and the environments in which they operate. Such statements are subject to inherent risks and uncertainties that can change as the world changes. Please see the cautionary statements in today's press release and in our various Securities and Exchange Commission filings. Finally, Some of today's remarks will adjust for those items that affect comparability between reporting periods. These items are explained in our non-GAAP reconciliations included in our press release.

Now I'll turn the call over to Ron. Thanks, Brian. Good morning, everyone, and thank you for joining us. As you can see from our third quarter results, Griffin's financial performance continues to exceed expectations. Our results were driven by the outstanding performance of our home and building products, HBP segment, which continued to see year-over-year growth in commercial volume. Residential volume decreased as expected year-over-year as backlog levels normalized. HPP had favorable price and mix across all products and channels. HPP's performance is supported by increased investment in business development for both residential and commercial, following two years of reduced sales and marketing activity due to elevated backlog and long lead times. HPP continues to invest in productivity and innovation to further drive growth. Clopay has fundamentally raised the bar for performance expectations. Turning to the consumer and professional product segment, CPP's results continue to reflect challenging market conditions. All channels and geographies were affected by reduced consumer demand and elevated customer inventory levels. As we announced last quarter to address the impact of these market conditions on certain U.S. product lines, CPP is expanding its global sourcing strategy to include long-handled tools, material handling, and wood storage and organizational product lines that are currently manufactured and sold in the U.S. market. By utilizing an asset-wide structure, CPP's U.S. operations are will be better positioned to serve customers with a more flexible and cost-effective global sourcing model. The global sourcing project is off to a solid start and remains on schedule and within budget. Specifically, there's been significant progress on our higher-profile work streams around plant closures and ramping up suppliers. We'll provide more detail in our year-end earnings call in November. Turning to capital allocation, during the quarter we announced actions to enhance shareholder value that included a 25% increase to our regular quarterly dividend, raising it to 12.5 cents, and a $200 million increase to our share repurchase program that brought the total authorization to $258 million. Earlier today, the Griffin Board authorized a 12.5 cent per share dividend payable on September 14, 2023, to shareholders of record on August 23. This marks the 48th consecutive quarterly dividend to shareholders, which has grown at an annualized compound rate of 17.6% since we initiated dividends in 2012. During this quarter, we repurchased 2.5 million shares, or approximately 4.4% of our outstanding shares for $85 million, at an average price of $33.58 per share. At June 30th, $173 million remained under the share repurchase authorization. We continue to believe there is a significant disconnect between Griffin's share price and the intrinsic value of our business's and we will remain active and opportunistic with our share repurchases. Turning to our guidance for the year, based on our third quarter performance and our expectations for the fourth quarter, we are again raising our full year guidance. We now expect segment-adjusted EBITDA to be $550 million compared to previous guidance of at least $525 million. In summary, these capital allocation actions and the fiscal 2023 guidance raise reflects the confidence Griffin's board and management has in our strategic plan and outlook, as well as demonstrate our commitment to enhancing both immediate and long-term value to our shareholders. I'll turn it over to Brian for the financial update.